News

India's Milk Production To Hit 177 MT By 2019-20

29 April 2014

INDIA - With the increasing income levels of average Indians, milk production in India will touch 177 million tonnes by 2019-20, the Associated Chambers of Commerce and Industry of India (Assocham), an apex industry body’s Economic Research Bureau (AERB) study said on April 22, 2014, writes Jagdish Kumar.

The study titled ‘Unlocking the growth potential of Indian dairy industry’ said, “Milk production across India has grown at a significant rate of about 19 per cent during the aforesaid period with overall milk production crossing 121 million tonnes mark as of 2010-11.”

The increase in the income level of an average Indian is being accompanied by a change in the food basket as the monthly per-capita consumption expenditure on milk and milk products in both rural and urban areas has grown significantly at about 92 per cent and 72 per cent respectively, the study highlighted.

While releasing the report, D.S. Rawat, national secretary general of Assocham said, “Growing at a compounded annual growth rate (CAGR) of over four per cent, milk production in India is expected to rise to about 177 mt by 2019-2020 and that would help in meeting the projected demand of 150 mt by 2016-17 that has been envisaged in National Dairy Plan Phase-1.”

However, despite being the largest milk producer in the world, per-capita milk availability in India at 252 grams falls below the global average of 279 grams per person per day.

New Zealand (9773 grams), Ireland (3260 grams) and Denmark (2411 grams) are top three countries in terms of per-capita milk availability, the study stressed.

Assocham study called India’s dairy industry to streamline its value chain processes and integrate the smallholder dairy producers into the processing value chain in order to improve the overall performance of the industry, more so as they possess inherent strengths like low production costs, lower liabilities and limited liquidity risk.

The study also pointed out that lack of knowledge and technical know-how, poor access to support services, limited access to credit and poor milk quality together limit the ability of smallholder dairy producers to take advantage of market opportunities.

“Concentration of milk production in some pockets together with high cost of transportation has led to rising disparity amid states in terms of per-capita milk availability,” noted the Assocham study.

The study recommended an urgent need to build up strategies to increase competitiveness in all segments of dairy chain, input supply, milk production, processing, distribution and retailing.

For promotion of dairy sector in India, emphasis now needs to be more on how to involve and encourage the village population into proactively adopting dairy industry as a viable alternative to the agricultural activity, Assocham stressed.

The state of Andhra Pradesh (AP) has recorded highest growth in terms of both milk production and per-capita milk availability thereby clocking a growth rate of over 41 per cent and about 36 per cent (approx.) during the five year period of 2006-10.

Apart from AP, the states of Rajasthan (28 per cent), Kerala (24.8 per cent), Karnataka (24 per cent) and Gujarat (23.7 per cent) are amid top five states in terms of clocking high growth in milk production.

Uttar Pradesh (UP) commands highest share of over 17 per cent in total milk production followed by Rajasthan (11 per cent share), Andhra Pradesh (nine per cent), Punjab (about eight per cent) and Gujarat (about eight per cent) which are amid top five states with a combined share of over 53 per cent.

While, Andhra Pradesh has recorded highest growth rate of about 36 per cent in terms of improvement seen in per-capita milk availability followed by Kerala (21 per cent approx.), Rajasthan (20 per cent approx.), Karnataka (19 per cent) and Gujarat (17 per cent approx.).